Fraudulent inducement—also known as fraud in the inducement—is a tort (wrongful act) claim or cause of action recognized in some states for fraud that occurs when one party to a contract intentionally misrepresents a material fact—usually regarding the risks, duties, or obligations involved—that another party to the contract reasonably relies on, causing the second party to enter into a contract it would not have agreed to if not for the fraudulent representation, and causing harm (damages or losses) to the party who reasonably relied on the misrepresentation.

Because fraudulent inducement combines elements of contract and tort law it is sometimes referred to as a "contort" claim or cause of action. In states that recognize a fraudulent inducement cause of action, the plaintiff may file a lawsuit and recover damages.

But a party who made an intentional misrepresentation may avoid liability if the other party contractually disclaimed any reliance on the first party’s fraudulent representations (a disclaimer of reliance provision in the contract). Whether a party is liable in any particular case depends on the contract’s language and the totality of the surrounding circumstances.

In Montana, fraudulent inducement is recognized as a cause of action when one party to a contract intentionally misrepresents a material fact, leading another party to enter into the contract based on that misrepresentation. The misrepresented fact must be one that the other party reasonably relied upon, and it must result in harm or loss to that party. This cause of action is a blend of contract and tort law, sometimes referred to as a 'contort' claim. To establish a claim for fraudulent inducement in Montana, the plaintiff must prove the elements of fraud, which typically include a misrepresentation of a material fact, knowledge of the falsehood by the person making the misrepresentation, intent to induce the other party to act, justifiable reliance by the victim, and damages resulting from the reliance. However, the presence of a disclaimer of reliance provision within the contract may affect the outcome of the case. Such a provision asserts that the party did not rely on the representations of the other when entering into the contract. The enforceability of these disclaimers can depend on the specific language used and the circumstances of the case. An attorney can provide guidance on the likelihood of success in a fraudulent inducement claim and the impact of any disclaimer of reliance provisions.